Putin calls for a strong state

By Vladimir Radyuhin

MOSCOW, JULY 8. In his first major address to the nation after being elected Russia's President in March, Mr. Vladimir Putin, painted a grim picture of the country's situation and said only a strong state could save the nation from extinction.

Much of Mr. Putin's 50-minute state of the nation address was devoted to a hard-hitting analysis of a catastrophic situation in Russian society and economy after 10 years of mishandled reforms.

``For several years now, Russia's population has been declining at an annual rate of 750,000,'' the President said addressing both Houses of Parliament gathered in the Kremlin on Saturday. ``According to forecast, we could lose 22 million people, or one- seventh of its present population, within 15 years. If the trend persists, the very survival of the nation will be jeopardised.''

Russia's economy was ineffective, the business climate remained bad, investment risks were high, and bureaucracy was stifling, Mr. Putin said. The country was losing the race to developed countries and could end up in the Third World.

He blamed a weak state for the country's deep and protracted economic crisis. ``Indecisive state and weak Government has stalled the economic and other reforms.''

Mr. Putin called for the state to stop interfering in business activity and concentrate on lowering the tax burden, enforcing the law and protecting property rights.

``The main barriers to economic reform are high taxes, the arbitrariness of bureaucrats and rash of criminals.''

Mr. Putin vowed to end ``crony capitalism'' that emerged and gained political clout during Mr. Boris Yeltsin's rule. ``The vacuum of power has resulted in private corporations and clans seizing some Government functions.''

He defended his reforms to cut the powers of the regions, reiterating the need for rebuilding a vertical of Central authority in the country which was disrupted when regions grabbed power from the Centre with Mr. Yeltsin's encouragement.

``No economic programme will succeed if there is no single economic and legal space throughout the country,'' Mr. Putin said, condemning local restrictions on the flow of capital and goods as ``outrageous and shameful.''

Without openly saying so, the President made it clear that he would push for painful reforms in the economy, bankrupting unprofitable state-owned companies, cutting back on ``excessive'' social benefits and withdrawing state support to losing industries.

Mr. Putin hailed Russia's military operation in Chechnya, saying it was the only way to ``prevent the collapse of the Russian Federation.''

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